# How do you calculate perpetual moving average?

**calculation**is the total cost of the items purchased divided by the number of items in stock. The cost of ending inventory and the cost of goods sold are then set at this

**average**cost. No cost layering is needed, as is required for the FIFO and LIFO methods.

Similarly, how do you calculate the moving average?

The **moving average** is **calculated** by adding a stock's prices over a certain period and dividing the sum by the total number of periods. For example, a trader wants to **calculate** the SMA for stock ABC by looking at the high of day over five periods. For the past five days, the highs of the day were $25.40, $25.90.

**Cost of Goods Sold**In that revenue is recognized at the time

**goods**are

**sold**, the

**inventory**costs are simultaneously expensed. The

**cost of goods sold**is

**calculated**by adding the beginning

**inventory**and purchases to obtain the

**cost of goods**available for sale and then deducting the ending

**inventory**.

Beside this, how do you calculate perpetual weighted average?

When using the **weighted average** method, divide the cost of goods available for sale by the number of units available for sale, which yields the **weighted**-**average** cost per unit. In this **calculation**, the cost of goods available for sale is the sum of beginning inventory and net purchases.

**Here are 4 moving averages that are particularly important for swing traders:**

- 20 / 21 period: The 21 moving average is my preferred choice when it comes to short-term swing trading.
- 50 period: The 50 moving average is the standard swing-trading moving average and very popular.